China’s announcement to impose export controls on two specific minerals could have dramatic and far-reaching implications for U.S. consumers amid growing geopolitical tensions between the U.S. and China. .

Chinese officials on Monday announced export restrictions on germanium and gallium after U.S. officials chose to impose restrictions on exports of advanced computer chips to China in October 2022. Because the two minerals are essential to the production of high-speed computer chips, military equipment, solar panels, fiber optic cables and other key technologies, China’s export restrictions could drive up prices for U.S. consumers. according to to CNBC.

These two minerals are essential to nearly all modern technology that utilizes optical and radio components, and many of these devices cannot operate without them. according to Go to electro page. A significant reduction in the supply of minerals available worldwide could make commodities that depend on their availability more expensive to consumers.

As relations between China and the United States continue to sour, there are growing concerns that China will tighten export controls, including on other strategically valuable rare earth minerals. according to to Forbes. Manufacturers typically use other strategically important rare earth minerals to make smartphones, electric vehicles and wind turbines. according to to Reuters.

As China continues to capitalize on its rare-earth mineral supply advantage, electronics will become even more expensive for U.S. consumers, according to ElectroPages. Beyond price increases, China’s decision to take advantage of its supply advantage could also lengthen supply chains and adversely affect production schedules and the availability of key parts, according to ElectroPages. (Related: Biden’s UN candidate praised China at CCP-funded lab, report says)

Reporter: “President says we are competing with China. He has been in office for 28 months. Are we winning?”

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That’s a great answer to a question that no one asked. pic.twitter.com/pje3n5VQPu

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U.S. manufacturers could eventually be forced to discontinue certain product lines if needed rare-earth minerals become unavailable if things escalate further, according to ElectroPages. It says.

According to ElectroPages, the US will either embrace the idea of ​​buying minerals from China or try to open its own rare-earth mineral mines for procurement. According to Electropages, Western mines will have to factor in higher labor costs and relatively stricter regulations by raising the price of the minerals that are mined, resulting in lower prices for electronics for Western consumers. said to be higher.

According to Reuters, China restricted exports of rare earth minerals to Japan in 2010 amid territorial disputes. At the time, China decided to limit exports of rare-earth minerals out of environmental concerns, claiming the sudden restrictions had led to a sharp rise in mineral prices worldwide, according to Reuters.

China produces about 60% of the world’s germanium supply and about 80% of gallium. according to to Reuters. Germanium consumption will increase by 10% in 2022 compared to 2021, and China exported 25% more gallium in 2022 than in 2021, according to Reuters. according to To International Holland Group.

China will mine about 70% of the world’s rare earth minerals extracted in 2022 and will hold about 85% of the world’s processing capacity within its borders, according to Reuters. The extent of rare earth mining in the United States is limited, but the lack of domestic refining capacity means that the extracted minerals are often sent to China for processing.

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